Construction market

Sweden

The Swedish GNP grew slightly in 2024 and GNP growth in 2025 is estimated at 1.7 percent. Global turbulence and the ongoing shifts in trade policies that commenced 2025 make it hard to assess how interest rates will develop but general consensus is that the repo rate will remain at 2.25 percent over the forecast period. If inflation stabilizes at around two percent, this will create the right conditions for household’s purchasing power and the economy to recover. Despite greater uncertainty at the beginning of the year housing construction is expected to continue to recover in 2025, albeit at a slower pace. The forecast for newly built premises has been adjusted downward marginally for 2025 although construction is expected to be above the historic average. While industrial investments have slowed, construction of new premises is being supported by politically driven investments in the justice system and the military. In the same vein, recovery in renovations of both homes and premises is expected to accelerate in 2025. Total civil engineering investments are expected to ratchet up compared to 2024 and increase by five percent. This is primarily due to expansion of the electricity grid as well as higher investments in roads and railroads but investments in ports and shipping lanes are expected to increase as well.

Norway

Norway’s mainland GNP is expected to grow by 1.2 percent in 2025. Norges Bank decided to leave the repo rate unchanged in March 2025 and it will take longer than previously predicted for interest rates to go down. Real wage growth and low unemployment is expected to boost purchasing power and benefit the construction market. Sales of newly produced homes is expected to slowly increase in 2025, although the postponed drop in interest rates and high construction costs will delay the normalization of new production. The forecasts for premise construction have been lowered for 2025 but still point to a more positive market than the two previous years. Higher military investments and good development in certain industries are stabilizing developments while the trend in commercial property, offices buildings and educational facilities is weaker this year. The renovation market is expected to grow in 2025. Forecasts for 2025 indicate good growth in the civil engineering market after a downturn in 2024. The most significant driving force of growth is expected to be the increase in power and energy plants but maritime infrastructure and municipal technique facilities are also expected to grow. Civil engineering investments are calculated to rise by 2.4 percent in 2025.

Finland

Optimism about the Finnish economy among consumers and companies has begun to improve. After a negative GNP development in 2024 GNP is expected to grow again in 2025 and is estimated at 0.8 percent. Inflation in Finland will most likely continue to be low and remain under two percent for the year. Even if interest rates continue to fall the level is still so high that they hamper continued growth. Recovery in the housing market has begun this year supported by falling interest rates and low inflation but the process is slow. As sales of homes on the second hand market accelerate sales of new homes are expected to follow, which will gradually lead to the start up of new housing production. Premise construction is expected to increase in 2025 driven by commercial, office and industrial buildings along with data centers and defense projects. Green investments will also contribute to higher premise construction. Housing renovations will likely have slight development during the year while renovations on the commercial market will increase primarily due to energy renovations. After declining for several years investments in civil engineering are expected to grow in 2025, mainly due to higher infrastructure investments. Zero growth is estimated in operation and maintenance in 2025.

Housing

	2025	2026	2027
Sweden
Norway
Finland

Forecast for production-started housing investments, new production and renovations

Premise investments

	2025	2026	2027
Sweden
Norway
Finland

Forecast for production-started premise investments, new production and renovations

Civil engineering

	2025	2026	2027
Sweden
Norway
Finland

Forecast for civil engineering investments

	Same forecast compared to the previous interim report
	Better forecast compared to the previous interim report
	Worse forecast compared to the previous interim report

As of 2025 Prognoscentret will provide market forecasts. Construction is divided into housing construction (new homes and renovation) and premise construction (new premises and renovation). Premises comprise all buildings except homes and agricultural buildings. Civil engineering includes new investments and operations and maintenance. The color of the arrows shows the comparison with Prognoscentret’s previous forecast.